Chapter 6 Flashcards
What are cooperate bonds
Fixed debit that must be repaired at a fixed future date
What is the buyer/ bond holder?
Regular periodic interest payments at fixed rate
What is returned to the bond holder at maturity?
Principal
What do you need for financial cooperate expansion? BRSS
1.Borrow,
2.reinvesting profit
3.selling bonds
4.selling shares
If interest rests rise- what happens?
If in these rates fall- what happens?
RISE- prices fall & yields raise
FALL- prices rise & yields fall
What do ownership shares represent?
Represents ownership of a cooperation
Characteristics of mutual funds?
- passive investing
-portfolio of certain stocks,industries,etc. - managed by professional
- pay a fee
- easy / comfort
Cheractenstics of index funds?
-lower fee
-passive income
Mirrors certain indexes
-no cons
How many industries are there? List their names
Primary, Secondary, Service
Which industry makes up 70% of Canada’s GDP?
Service
What affects cooperate share prices?
DEMAND:
-current profits and dividends
-confidence in management
-trends in the industry
-general economic climate
What is a spot market?
Immediate delivery
What is a future market?
Prices agreed in advanced for future delivery
What is the term that refers to the right to buy a commodity at a fixed price/ before a set date?
Call
What is the term when referring to the right to sell a commodity at a pre-arranged price on/before a CERTAIN date
Put
STOCK TERM: What is the term for a safe and stable large company
Blue Chip
STOCK TERM: What type of market is it when prices are expected to rise for a sustained period of time?
Bull market
What is a bear market?
A market where prices of goods are expected to fall for a sustained period of fine.
STOCK TERM: what is a dividend yield?
Current annual dividend/ current share prices
STOCK TERM: What is EPS?
It is how much a company makes for each share of a stock
Small businesses have what ____ growth and ___ employees.
Vertical & less than 50
Big businesses have _____ growth and ___ employees
Horizontal & 500+
What is a coperate alliance?
A is when compares form a network that operates as a single company.
What is a holding company?
It is when company’s tagline large blocks of shares in other compares to influence + control
What ia multinational cooperation?
Firms that operate from a global perspective.
What are the 5 forms of business organization? SPCCG
- SOLE PROPRIETORSHIP
2.PARTNERSHIP
3.COPERATION
4.CO-OPERATIVE
5.GOVERNMENT ENTERPRISE
What is Sole Proprietorship?
PROS & CONS?
Owned + operated by 1 person
Responsible for debts I entities to profit
PRO
Only 1 person makes decisions
easy to establish
Finances are confidential
CONS
Unlimited lability
High Tex rate
Finances limited
What is Partnership?
PROS + CONS?
Owned by 2 or more people
Bonded by legal agreement
PROS
Easier to obtain credit, lower tax rate
Pooling of talent + capital
CONS
Joint several liability
Transfer of ownership/termination of partnership
What is a corporation?
PROS & CONS?
Can be private & public
Formed they articles of incorporation (government authorized)
PROS
acts as an independent entity
lower tax rates
able to attract investors more
business longevity
CONS
legal and government fees to establish
closely regulated by government
What is a Co-Operative?
PROS + CONS
owned equally by its members
common goal and purpose
every member gets a say
PROS
equal management decisions
limited personal liability
CONS
Management decisions can be complicated
What is a Government Enterprise?
Owned by government
Creates employment
Operates in best interest of the community
